SongVest offers up an innovative approach to music memorabilia

Summary
Sit down with SongVest president and founder Sean Peace to get the scoop on his company’s innovative approach to music memorabilia: rights and royalties! VIEW THE AUCTION NOW

SongVest, Inc. is known as the world’s first and only song-rights auction house. The company provides “music memorabilia with a paycheck” by acting as a broker between songwriters (or their heirs) and rights buyers. Since 2007, SongVest has given music fans, collectors and investors the unique opportunity to own a part of once-in-a-lifetime memorabilia.

This month, SongVest will hold two auctions. From March 6 -13, 2010, at songvest.com, Christian metal icons, Stryper, will feature rights to a new song titled “Alive,” and, on top of that, will offer a VIP package. This mega-package includes a private meeting, a lifetime VIP pass, a personalized plaque and Michael Sweet’s own acoustic guitar.

Next up, from March 13-20, 2010, book rights to author Jake Brown’s upcoming releases on “Jane’s Addiction: In The Studio” and “Alice In Chains: In the Studio” will be featured. SongVest partnered with book publisher Rock ‘N’ Roll Books to offer a 30 percent ownership share of each title.

Sean Peace, president and founder of SongVest, is proud of all the recent accomplishments in the field of music collectibles and credits it to the company’s innovative spirit. Here’s what he had to tell Goldmine about the ideas behind the company, how the system works and why SongVest auctions are a great choice for collectors.

Explain how SongVest is a new model for music collectors. Sean Peace: I think SongVest brings a new dimension to music collectors. Never before have you been able to truly share directly with the songwriter or artist like you can now. It is one thing to buy a memorabilia piece second-hand or even a stage-used guitar, but this is like buying a guitar that is still being played. There is a direct connection with the seller that creates a long term bond that has never been seen before.

The ability to for a collector to own a piece of the song’s royalties has only been reserved for the very rich or music publishers and labels. Think MJ with the Beatles catalog. Now we have expanded that to uber-fans who look at songs with more than just a financial multiple. Historically you can only see a return on your memorabilia purchase when you sell it. Now, for the first time, you only have to wait four months.

How did the idea for a song rights auction come to you?Peace: A good friend of mine is a big songwriter in Nashville. One day she mentioned to me about cashing out and selling her catalog. I am a consummate entrepreneur, so I started asking questions about how it works and why. I quickly found that, for a songwriter, it is an all-or-nothing model. You basically have to sell all of your songs and the buyers are record companies or hedge funds who only look at the financial return. Then the light bulb went off. Why sell everything? Why not just sell one song, or even just a percentage? Also, why sell to industry insiders who have no connection with the song, why not sell it to the people who want it the most: the fans. They will pay a premium since the financial reward is secondary.

How did you arrange this newest package with Stryper?Peace: Stryper was our first auction. It was great working with Michael and his management company, Deep South. Both are forward-thinking and continually break new ground musically and business-wise. With the new album release, they wanted to accelerate the ability of their fans to share in their success. Michael and Deep South broke the mold again by offering a new fan-favorite song instead of a classic, and included a rare dinner with Michael and the guitar he used to write songs all the way back to the ’90s.

The Stryper auction packages offer a lot. Explain the plaques a little bit. And the lifetime VIP pass.Peace: All the plaques are produced by RIAA certified Milestone Awards in CA. If a song is certified, then our awards are certified as well. Each one is customized and produced graphically by David Prohaska, co founder and CMO of SongVest. He is the genius behind everything cool with the site and the awards. Most awards include hand written lyrics and some are very large and include other memorabilia items that David finds at auction.

The lifetime VIP pass is something we have wanted to do for a while, so it is great that Michael is the first to use this. Basically, we want something beyond a meet-and-greet. It depends on the seller but the concept is to offer an experience on an ongoing basis that allows the buyer unequalled access that no VIP ticket package will provide.

How are these arrangements made with the bands?
Peace: Each VIP package will be different so we will work with their management on how best to make these arrangements. One additional concept is to make real band passes that they can use to enter shows.

How was the auction arrangement made with book publishers? That is just as impressive as the auction arrangements made with bands.Peace: Luckily our first book deal, with Jake Brown, was completed with his own publishing company. That, of course, made it a lot easier. We have reached out to several other book publishers to expand this type of auction.

What past auctions have been most successful?Peace: I can’t say that one has been more successful than another. Each one has broken new ground, whether it was the first — Stryper — breaking out into R&B with Preston Glass and Reggie Calloway, books, classics like the Monkees, and more. As you can see each has bred more diverse success for SongVest. I guess the most important success has been that we were able launch a company like SongVest in this economic period and see auctions grow larger and bid prices climb higher.

Tell us about your personal favorite auction package.Peace: It is funny, but for me it was Reggie Calloway. I grew up listening to Midnight Star and I think those songs are so cool. The funny part is that David, our CMO and the music database behind SongVest, did not recognize who Midnight Star was. He knows everything about music so I was so happy to finally know more than he did. We both laughed about it as I am sure it will never happen again.